In a year as turbulent as 2020, you might think that buying a home is at the bottom of many priority lists.
Think again. Existing home sales just jumped to a 14-year high, and the trend shows no signs of slowing down anytime soon.
What does this mean for you?
If you’re dreaming of buying your first home, now is the perfect time to make it happen. Here’s your homeowners checklist to help you turn your dream of homeownership into reality!
1. Get Your Finances in Order
It’s never too early to start saving for your new home. Even a 3% downpayment on a $300,000 home is nearly $10,000, so you’ll need plenty of time to plan and save.
You also need to factor in closing costs (typically 3%-5% of the loan amount), as well as any move-in expenses. This is also the time to strengthen your credit, if it’s less than stellar, as that will affect your mortgage and interest rate.
2. Secure Financing
Next you’ll need to consider which mortgage options you might qualify for. Common programs for first-time home buyers include:
- Conventional mortgages
- FHA loans
- VA loans
- USDA loans
Many states offer financial assistance for down payments and closing costs, so check to see what’s available in your state. It’s also a good idea to compare different options among local banks, credit unions, and mortgage brokers.
Important note: Just because a lender approves you for a $300,000 mortgage doesn’t mean you should spend that much. Use a mortgage calculator to determine how much house you can afford so you don’t end up “house poor” after you move in.
3. Start Shopping
Now comes the exciting part: looking for houses! Search online, hire a real estate agent, and drive around the neighborhoods that most interest you.
Think carefully about your budget and lifestyle. Attend open houses and view as many properties as possible to better understand your wants and needs.
Are you looking for a starter home or your forever home? Would you rather buy a small condo that’s move-in ready or a larger fixer-upper? How important is it for you to be near good schools or have a shorter commute to work?
4. Make an Offer
When you think you’ve found “the one,” take a final look at your budget. You don’t want to make an impulsive decision or offer more than you can afford.
Ask your real estate agent to ensure your offer is competitive but still within your budget and the home’s actual value. If the seller accepts, you’ll make a good-faith deposit and the process moves into escrow. This gives you time to tick the final item off your homeowners checklist, which is…
5. Get an Inspection
No matter how amazing the home looks on the outside, you have no way of knowing what’s happening underneath. Hire a professional home inspector to analyze the safety, integrity, and overall condition of the house.
If the inspection reveals no serious problems, congratulations! You can move ahead to the closing date with confidence.
On the other hand, what if the inspection reveals serious defects that the seller chose not to disclose? You’re better off saying goodbye and continuing your search for a home in better condition.
Bookmark This Homeowners Checklist
Whether it’s for home office space, a home gym, or a bigger backyard, many Americans are on the move this year.
Would you like to join their ranks? Use this homeowners checklist to guide you through the home buying process!
Are you looking for a home in the Twin Cities area? Click here to begin your search.